In a move that underscores the growing institutional interest in cryptocurrency, South Korea’s National Pension Service (NPS) has significantly increased its exposure to the digital asset market. The world’s third-largest pension fund by assets revealed this week that it purchased $33.7 million worth of MicroStrategy shares during the second quarter of 2024.
This latest investment follows the NPS’s previous foray into the crypto ecosystem with a $19.9 million purchase of Coinbase shares in the third quarter of 2023. As of June 2024, the pension fund held approximately $51 million worth of Coinbase stock.
MicroStrategy, a business intelligence firm led by prominent Bitcoin bull Michael Saylor, has become a popular proxy for Bitcoin investment due to its massive holdings of the cryptocurrency. By acquiring MicroStrategy shares, the NPS is effectively gaining indirect exposure to Bitcoin without directly investing in the volatile digital asset.
The SEC’s recent approval of the first leveraged exchange-traded fund targeting MicroStrategy further highlights the growing institutional appetite for Bitcoin-related investments. This development could potentially attract even more traditional investors to the cryptocurrency market.
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While the NPS’s investments in MicroStrategy and Coinbase signal a growing acceptance of cryptocurrencies within the institutional investment community, it’s important to note that the fund has faced criticism for its exposure to the highly volatile digital asset market. Some argue that pension funds, which manage retirement savings, should prioritize stability over speculative investments.
As the cryptocurrency market continues to evolve, it will be interesting to see if other major pension funds follow in the NPS’s footsteps and allocate a portion of their portfolios to digital assets.
Disclaimer: The information in this article is for general purposes only and does not constitute financial advice. The author’s views are personal and may not reflect the views of Chain Affairs. Before making any investment decisions, you should always conduct your own research. Chain Affairs is not responsible for any financial losses.
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